Darmin: There is room for cutting lending rate

Jakarta (ANTARA News) - Coordinating Minister for Economy Darmin Nasution said there is still room or step that could be taken by the Financial Service Authority (OJK) to cut lending rates.

"OJK could do something, other than Bank Indonesia cutting its BI 7-day Reverse Repo Rate," Darmin said here on Monday.

He said OJK could push for rate cut to adjust to the central banks reference interest rate , which has been cut to 4.25 percent.

He said the financial industry watchdog once took similar measure by giving facility to the banking industry in a bid to reduce the non performing loan (NPL) ratio.

Credit base interest rate (SDBK) was once adopted by Bank Indonesia, he cited, adding OJK could set benchmark to force bank to cut their lending rates.

OJK chief Commissionner Wimboh Santoso said commitment with the banking industry is needed as this sector is not sufficient enough with high operating cost contributing to an increase net interest margin.

Source: ANTARA News

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